My Core Options Trading Strategy

My trading style is evolving all the time. This page will likely be updated according to what is working based on various testings I conduct.

One thing that will remain constant as my core strategy is to act like an insurance company by selling premiums. This allows me to create high probability setups and not worry too much about being wrong. My trading style does have directional and speculation components to it, but the underlying strategy is to be mostly mathematical and mechanical.

Since we cannot tell which way the underlying security would move in most of the time (we could try using techniques such as Trade Apgar Test) it would be more consistent to set up trades with a higher winning probability disregard for the directional bias.

In addition to the probability setup, I do not trade for the sake of trading. I only trade when the setup is right. Use the baseball analogy, I do not try to swing every ball that is thrown at me. I only swing when I know I can hit it far and hopefully a homerun.

Having said all that, the “Wheel” options trading strategy is my core strategy right now. I have documented the tradings in the trading journal.

VIX Exchange Traded Products (ETPs)

Primarily trading VXX. Occasionally UVXY options. As of now, short out of money VXX Call options is my core strategy.

Options Strategies for High Volatility

Options Strategies for High IV >>

Options Strategies for Low Volatility

Options Strategies for Low IV >>